Empty Homes Tax due dates

Every owner of residential property will have to make a property status declaration for the 2017 calendar year. This will determine if the property is subject to the Empty Homes Tax, also known as the Vacancy Tax.

Properties not subject to the tax

Most properties will not be subject to the Empty Homes Tax, including those:

Used as a principal residence by the owner, his/her family member or friend, or other permitted occupier for at least six months of the current year

Rented for at least six months of the current year, in periods of 30 or more consecutive days

Estate of deceased

The property was unoccupied for more than 180 days because the registered owner is deceased and a grant of probate or administration of the estate was pending.

Death certificate of registered owner

Transfer of property

The property title was transferred during the year.

Title search or certificate of title showing the date that title was transferred

Undergoing redevelopment or major renovations

Your property was unoccupied for more than 180 days because:

The property was undergoing redevelopment or major renovations where permits:

had been issued and were being carried out diligently and without delay, or

were under review for redevelopment of vacant land or the conservation of heritage property.

Or, the property is vacant and part of a phased development which has:

A rezoning application under review

Approved rezoning with permits under review

Approved rezoning where construction has commenced

Short description of renovation/ redevelopment project

Permit number

Strata rental restriction

Your property was unoccupied for more than 180 days because it was subject to a strata rental bylaw as of November 16, 2016:

that prohibited rentals or restricted the number of units that may be rented, and

the maximum allowable number of rentals had already been reached.

Copy of strata bylaws

Letter from strata council confirming the maximum number of units have been rented

Court order

Your property was unoccupied for more than 180 days because the property was under one of the following:

A court order

Court proceedings

An order of a governmental authority prohibiting occupancy

Copy of the court order

Limited use residential property

Your property was unoccupied for more than 180 days because the use of the property was limited to one of the following:

Vehicle parking

A result of the size, shape, or other inherent limitation of the parcel, a residential building could not be constructed

Land survey or legal description of parcel that clearly illustrates the limiting aspects of the property

Principal residence

Definition of principal residence and how it applies to you.

Definition of principal residence

A principal residence is the place where you usually live and make your home and conduct your daily affairs. This is the place where you receive mail and pay your bills from, including utility bills.

You would use the address of your principal residence for documentation like:

Income tax returns

Your driver’s licence or other pieces of identification

Insurance documentation

Medical Services Plan documentation

Vehicle registration

Scenarios

Question

Subject to tax?

If an owner lives in his/her residential property for more than 180 days, but the property is not their principal residence, will the property be subject to the Empty Homes Tax?

Yes. A second home that is used by the owner, or his/her family members or guests, but is not a principal residence and is not occupied by a tenant or subtenant for at least six months of the year, is considered vacant and subject to the tax unless a specific exemption applies.

Are tenants required to be principal residents for the property to be exempt from the tax?

No. For a rented property to be exempt from the tax, it must be occupied by a tenant or subtenant for at least six months of the year (in periods of 30 or more consecutive days), but the property is not required to be the principal residence of that tenant or subtenant.

This allows rentals for non-consecutive periods of at least 30 days, such as a fixed-term rental to someone who is renovating their home or who has temporary work in Vancouver.

Can a married or common law couple have two principal residences that are exempt from the tax?

Yes. Spouses (whether married or common law) can have different principal residences for the purposes of the Empty Homes Tax so long as that is where each individual lives, makes his or her home and conducts his or her daily affairs.

If spouses declare different principal residences, they must be able to provide information or evidence that demonstrates that each property was used in accordance with the bylaw’s definition for at least six months of the applicable tax year.

False declarations will result in fines of up to $10,000 per day of the continuing offense, in addition to payment of the tax.

If a property is an owner’s principal residence but they spend more than six months of the year living elsewhere or travelling, will the property be subject to the tax?

No. If a residential property is an owner’s principal residence then it is exempt from the Empty Homes Tax.

The bylaw definition of principal residence allows owners to leave their properties for extended periods of time and not be subject to the tax.

To be exempt from the tax, the owner is not required to physically occupy the property for any specific period of time, as long as the property is their principal residence.

If an owner declares the property as their principal residence, they must be able to provide information or evidence that demonstrates that the property was used in accordance with the bylaw’s definition for at least six months of the applicable tax year.

Second home

Home used only intermittently, held as an investment, or occupied by family member or friend.

If a property is unoccupied for more than 180 days of the current year, it will be subject to the tax unless an exemption applies.

Scenario

NOT subject to the tax

Subject to the tax

Occupied by a family member or friend

The property will not be subject to the tax if it is not the principal residence of the owner, but is the principal residence of his/her family member or friend for at least six months of the current year.

The tax will apply if a property is:

Not a principal residence or not rented for at least six months of the current year (in periods of 30 or more consecutive days)

Buying and selling property

Transfer of property, folio numbers and access codes, and how to declare a sold property.

Properties that have had a transfer of legal ownership during the tax year will not be subject to the tax; however, the current registered owner is still required to submit a property status declaration.

Understanding folio numbers and access codes

Property owners will require their folio number and access code to submit an Empty Homes Tax property status declaration:

Every property is uniquely identified for property tax purposes with a folio number

Each registered owner of a property has their own access code. If there is more than one registered owner of a property, each owner may have their own unique access code.
For example:

Fred and Elaine Jones = 1 Access Code

Fred Jones, Elaine Jones = 2 Access Codes (one code each)

At any point in time there will be only one set of active access codes. When a property transfers to a new owner, a new set of unique access codes will be created for them. The previous owner’s access codes will be locked so that they can only be used to view historical data.

Folio and access codes are issued regularly as part of declaration and other tax administration processes. Property owners can find this on any property tax notice or call 3-1-1 to obtain this information at any time.

Who should declare if a property sale has occurred?

The ability to submit a property status declaration, or provide any other submission related to the Empty Homes Tax, is only possible by the current registered owner:

Only one registered owner can submit a property status declaration each year. Once a declaration has been submitted, additional owners will not be able to submit a second declaration.

For properties sold after the declaration period has opened, property status declarations are to be made by the seller prior to the transfer of the property.

Buyers’ considerations – request additions in the Contract for Purchase and Sale

Buyers of residential property should consider requesting the following to be included as additional terms in the Contract of Purchase and Sale:

Status declaration - That the seller of the property provide a copy of the completed and filed property status declaration

Statutory declaration - That the seller provide a statutory declaration at closing confirming the filed property status declaration is true and correct

Express representation and warranty - confirming that the property has not been vacant (as defined by the Bylaw) for more than 180 days during the current or prior year

Holdback of potential tax pending - Providing that the City has not yet determined if a property is subject to the tax or not, provide for a holdback of the potential tax pending the City’s determination

Adjustment - Where the property is clearly subject to the Vacancy Tax, provide that an adjustment be carried out by the buyer’s conveyancer and the Vacancy Tax will be borne solely by the seller

Previous owner did not make declaration

If a property is sold and the previous owner did not make a declaration, the following applies:

Property transferred before December 31

Property transfers on or after
January 1

No property status declaration is made

The buyer can submit the declaration and claim the property transfer exemption

We recommend that the seller make the property status declaration wherever possible.

It may be difficult for the buyer to make a declaration on behalf of the seller because:

They were not responsible for occupying the property for at least six months of the reference period.

The ownership of the property did not change during that period.

If the seller does not make a property status declaration, it is recommended that the buyer:

Submits the declaration on behalf of the seller

Requests a statutory declaration from the seller at closing confirming that the status of the property is true and correct.

The property will be deemed vacant and subject to the tax. The current owner will be held responsible for the payment of the tax as it is attached to the property account.

If the City has not yet determined if a property is subject to the tax, it is recommended that the contract provide for a holdback of the potential Vacancy Tax pending the City’s determination. Or where the property is clearly subject to the tax, provide that an adjustment be carried out by the buyer’s conveyancer and the Vacancy Tax will be borne solely by the seller.

Renting and listing for sale

Rental restrictions, legal ownership, or unable to rent or sell.

If a property is unoccupied for more than 180 days of the current year, it will be subject to the tax unless an exemption applies.

Scenario

NOT subject to tax

Subject to tax

Renting property

A property will not be subject to the tax if it was rented for at least six months of the year, in periods of 30 or more consecutive days; for example:

Short term leases are exempt if they have been rented for a minimum of 30 days in periods that add up to six months

Long term leases are exempt if they have been rented for six months or more

A property is not required to be the principal residence of the tenant or subtenant. This allows rentals for non-consecutive periods of at least 30 days, such as a fixed-term rental to someone who is renovating their home or who has temporary work in Vancouver.

There is no exemption for property that is unoccupied solely because it is being listed for rent.

Owners are encouraged to reduce the asking rental cost until the unit is rented, as they will not be exempt from the tax on the basis of being unable to find a tenant.

Secondary suite and/or a laneway home or housing co-operative (co-op)

It is rented for at least six months of the current year in periods of 30 or more consecutive days

If a parcel of Class 1, Residential property has more than one dwelling on it (such as a single family home and a laneway house), it is taxed as a single parcel.

Leasehold property

A property will not be subject to the tax if:

The property is on one parcel and in a building with separate rental units

Only one unit is used as a principal residence or rented for at least six months of the current year in periods of 30 or more consecutive days

To determine if other types of leasehold property are subject to the tax, more information—including the civic address—will be needed.

Some leasehold tenants are recorded on the property tax roll and are responsible for paying regular property taxes. The long-term leaseholders are responsible for ensuring the property is occupied and are required to make an annual property status declaration in the same way that an owner of non-leased land would be.

Multi-unit rental building

If you are the owner of a multi-unit, purpose-built rental building that is under one folio, you are required to submit an Empty Homes Tax property status declaration.

To be exempt from the Empty Homes Tax, only one unit within the building needs to be:

Used as a principal residence for at least six months of the current year; or

Rented for at least six months of the current year in periods of 30 or more consecutive days

In the declaration, it is a legal requirement for the registered owner to provide the tenant’s name(s) as evidence that the property is a rental property. For a multi-unit residential building as noted above, you are only required to list at least one tenancy agreement with the option to include more or all for the property.

What to do if a property has two or more adjacent parcels that are used as one residence

Adjacent parcels of land that share a property line or strata lots that have been joined by a permitted interior connection (such as a door or staircase) and are used as one residence will be treated as one residence for the purposes of the Vacancy Tax.

The tax will not apply to any of the parcels, when adjacent parcels are:

Used as a principal residence

Rented out for at least six months of the year or qualify for an exemption from the Empty Homes Tax

Owners will need to be prepared to provide information and evidence to demonstrate that the adjacent parcels are used as one residence.

In some cases, BC Assessment may treat multiple adjacent parcels as a single parcel and there may be only one property tax folio; in this case, only one property status declaration will need to be submitted.

Under construction or redevelopment

Home or property under construction or redevelopment.

If a property is unoccupied for more than 180 days of the current year, it will be subject to the tax unless an exemption applies.

Scenario

NOT subject to tax

Subject to tax

Under construction and renovation

​A property is not subject to the tax if a property is undergoing major renovations, construction, or redevelopment that causes the property to be vacant for 180 days where:

Permits have been issued

The renovation or redevelopment work is being diligently carried out

A property is subject to the tax if no permits have been issued for major renovations or redevelopment.

Minor renovations do not qualify for an exemption.

There are many types of renovations that may make occupancy unsafe or impractical while work is underway. However, very few of these will require the home to be unoccupied for 180 days; rather, the vast majority of renovation projects can be completed in less than six months’ time.

If a renovation project can be completed in under six months, the home must either:

Continue to be the principal residence of the owner, a friend, or family member

Rented out (in periods of 30 or more consecutive days) for at least six months of the tax year to be exempt from the tax

Vacant land

For projects requiring rezoning, submission of a full and complete letter of enquiry package and full payment of the required fee by the registered owner will meet this requirement.

A property is subject to the tax if no permit application has been submitted for redevelopment to create housing supply.

Heritage preservation

A property will not be subject to the tax if it is a property that:

Is a heritage property as it is defined in the Vancouver Charter (property that, in the opinion of Council or its delegate, either “has sufficient heritage value or character to justify its conservation” or “is protected heritage property”)

Has a development permit or heritage alteration permit application for the rehabilitation and conservation of heritage property, which has been applied for and is under review

A property is subject to the tax if no permit application has been submitted for redevelopment to create housing supply.

Phased development

A property is not subject to the tax if it is a property with no existing dwelling unit that is part of a phased development, and one of the following applies:

A rezoning application is under review

Rezoning has been approved and permits are under review

Rezoning has been approved and construction has commenced

A property is subject to the tax if no permit application has been submitted for redevelopment to create housing supply.

Vacant land

Residential property that is vacant land.

Vacant unimproved residential properties that are not in the development process will be subject to the tax unless an exemption applies.

The goal of the Empty Homes Tax is to create more rental housing in Vancouver. This provision was put in place to encourage owners of vacant land to move forward with the creation of housing supply on their properties.

Scenario

NOT subject to the tax

Subject to the tax

Vacant land

The Empty Homes Tax will not apply to Class 1 residential property that is vacant land, when all of the following apply:

There is no existing dwelling unit on the land

Permits to build or develop have been applied for and are under review

The application to build is being diligently pursued

For vacant land with no dwelling unit, the Vacancy Tax Bylaw requires that a permit application is under review and being diligently pursued, and does not require the permit to be issued for the exemption to apply.

Vacant unimproved residential properties that are not in the development process.

What to do if your property is currently empty or under-utilized

If you do not qualify for an exemption, several options are available to you:

Become a landlord by renting your property for at least six months of the year, in periods of 30 or more consecutive days

Enlist a property management firm to rent your property on a long-term or periodic basis

Invite a family member or friend to occupy your property as his/her principal residence for at least six months of the current year

Occupy your property as your principal residence for at least six months of the current year

Keep your property as-is and pay the Empty Homes Tax

Sell your property

LandlordBC can provide you with the knowledge and tools you need for renting out your home.